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7 Step Guide To Retiring Abroad.
Retiring abroad is an exciting opportunity to reinvent your life and potentially reduce retirement costs. However, you should make sure a new country will meet all of your retirement needs before you move there. Here are 7 things to consider in preparing to move abroad in retirement.
Step 1: Settle On Your Dream Destination.
The first and most important decision you will need to make is where exactly you wish to retire. Perhaps family ties to a specific place may make this choice easy. Or you may want to choose a country that you have always admired from afar. The good news is, you can receive the Social Security benefits you're entitled to no matter where you live, with a few exceptions.
Step 2: Thoroughly Understand The Health Care System and Health Insurance.
You typically can't use Medicare benefits in a foreign country. So, it is important to fully understand what health insurance coverage for ex-pats is available, and at what cost. If you are currently on medication, find out exactly what it would cost to be prescribed the same medication within your new country.
Be certain to research the quality of health care in your new country. Do not even consider making a permanent move until you are satisfied with the information you've gathered.
Some people opt out of insurance altogether and keep an emergency fund sufficient to cover the costs of even catastrophic care. Unless you are extremely well to do, we do not recommend this. Get reliable health insurance coverage that can be used effectively in the country of your choice.
Step 3: Rent First.
If you're considering retiring in a new country, it's usually wise to rent first. This will give you a chance to experience the area before committing, and you can move easily if the country or part of town doesn't meet your needs and preferences. Understand that different cities within the same country can offer vastly different lifestyle opportunities.
Consider visiting at different times of the year as well. Test the atmosphere during peak tourist season and compare it to the lull of the low season. Make sure you experience your location of choice during winter or the rainy season, not only during spring and summer.
Step 4: Research Local Transportation And Amenities.
Understand the transportation options of the retirement location you choose. In order to thoroughly experience and enjoy your destination, will you need to invest in owning car or will public transportation suffice?
Check out whether potential retirement spots provide all the amenities you need to fully enjoy your new retirement lifestyle. Retirement is your opportunity to discover or rediscover your passions, so make sure your destination of choice offers the things you feel you would enjoy.
Consider the international transportation options.
If you plan regularly visiting family back in America, consider the distance to the nearest international airport before deciding where to relocate.
Step 5: Unless You Have A Good Handle On The Native Language, Go For An English Speaking Community.
Some people are uncomfortable retiring in an area where there aren't any other English speakers. It will be hectic for you the first few months as you settle into your new lifestyle. Being unable to communicate can be socially isolating and make it difficult to complete basic necessary tasks like setting up a new phone and internet, creating a bank account, or completing paperwork. Consider whether you have sufficient command of a foreign language to communicate, and if not, how eager you are to pick it up. It's always advised to learn at least a few basic phrases in the native tongue.
Step 6: Know Your Finances.
Obviously, you need to have precise knowledge concerning how much retirement funds you have coming your way. Know this for the short term and the long run. Each and every one of your retirement decisions should be at least partially guided by this.
The rate of exchange between the local currency and the U.S. dollar can have a big impact on your retirement finances, and changes in the exchange rate could affect your spending power. It may be a good idea to avoid exchange rate problems by moving to a country that uses the U.S. dollar as its currency, such as Panama or Ecuador. The dollar usually runs quite strong against currencies worldwide. This creates opportunities for American retirees to enjoy greatly enhanced purchasing power.
Perks and more.
Some countries roll out the welcome mat for foreign retirees, sometimes offering significant tax breaks, in-country discounts, and other perks to resident retirees. Look into these type of options and benefits before making your move.
Step 7: Know The Laws.
Many Americans walk into a new country expecting regulations and laws to be pretty much the same as they are in the U.S. Such an assumption can lead to catastrophic mistakes. Things that are legal in the U.S. could incur a heavy fine or land you in jail in a different country. Each country has their own rules, guidelines and etiquette, that you should make every attempt to know and respect. The last thing you want to do is to go into a foreign country and try to "Americanize" the place.